Lawmakers ratify 2025 national budget

Philippine lawmakers on Wednesday evening ratified the bicameral conference committee report on the PHP 6.352-trillion national budget for 2025. 

The committee earlier on Wednesday approved the final version of the budget bill. After the measure is ratified by Congress, it will be sent to Malacañang.

Presidential Communications Office Secretary Cesar B. Chavez told reporters in a Viber message that Philippine President Ferdinand R. Marcos Jr. is “tentatively” scheduled to sign the 2025 General Appropriations Act on Dec. 20.

In the bicameral report, lawmakers scrapped the PHP 74-billion subsidy for Philippine Health Insurance Corp. (PhilHealth) under next year’s budget, saying the agency needs to use its PHP 600-billion reserve funds to boost its services.

“PhilHealth has P600 billion in reserve funds and they should use these to address delayed reimbursements, and we will use this (funding subsidy) to fund departments that need it more,” Senate Finance Commitee Chairperson Mary Grace Natividad S. Poe-Llamanzares said in mixed English and Filipino.

Ms. Poe said PhilHealth would still have funding for its operations, but she did not give the exact figures.

Senator Joseph Victor G. Ejercito, one of the authors of the Universal Health Care (UHC) Act, said the legality of slashing the PhilHealth subsidy could be challenged since it is mandated under the sin tax and UHC laws.

“By law, this is really earmarked for PhilHealth’s use and for indirect contributors such as persons with disabilities, senior citizens and those who cannot pay for their premiums,” he told reporters later in the afternoon.

Senator Sherwin T. Gatchalian said PhilHealth could continue to provide services without the PHP 74-billion yearly subsidy.

“It’s a question of spending, not cash flow,” he told reporters. “If you look at the balance sheet of PhilHealth, they’re very healthy and the reserve funds are quite substantial.”

In a statement, Senate Deputy Minority Floor Leader Ana Theresia N. Hontiveros-Baraquel opposed the removal of the subsidy for PhilHealth since it is mandated by the Constitution for the government to pay for the premiums of its indirect members.

“Despite these ‘excess or reserve funds’ there are still laws that mandate this, and it is illegal, unfair and potentially unconstitutional to remove it,” she said in a statement in mixed English and Filipino.

“If the government abandons this obligation, ordinary citizens will be burdened by their monthly contributions to PhilHealth.”

In August, the Senate passed on final reading a bill that seeks to cut PhilHealth premiums to 3.25% next year from 5% this year under the Universal Health Care Act.

Ms. Poe said the 2025 budget does not include a provision allowing the National Government to sweep unused funds of government-owned or -controlled corporations (GOCC).

A provision in this year’s national budget authorized a cash sweep from GOCCs. The Supreme Court had blocked the transfer of PHP 29.9 billion, the last tranche of PhilHealth’s P90 billion excess funds, to the Treasury.

The excess PhilHealth funds would have been used to support unprogrammed appropriations worth PHP 203.1 billion, for state health, infrastructure and social service programs.

Filomeno S. Sta. Ana III, coordinator of Action for Economic Reforms (AER), said taking out the subsidy from the spending plan would worsen PhilHealth’s financial situation and make it harder for contributors to sustain the agency’s programs.

“What they removed are the contributions from those who do not have the ability to pay PhilHealth premiums,” he said in a Facebook Messenger chat.

“That also means direct contributors are the ones that will bear the sole burden of sustaining PhilHealth.”

Zy-za Nadine M. Suzara, a public budget analyst and former executive director of policy think tank Institute for Leadership, Empowerment and Democracy, said giving a “zero budget” for the PhilHealth subsidy is the same as slashing funding for the needs of indirect members.

“The General Appropriations Act cannot amend the Universal Health Care Law and the Sin Tax Law,” she said in a Viber message. “PhilHealth should have a reserve fund for two years or projected expenditures.”

Meanwhile, the bicameral committee also reduced the budget for the Ayuda Para sa Kapos ang Kita Program (AKAP) to PHP 26 billion, Ms. Poe said.

The House earlier proposed a PHP 39-billion budget for the Department of Social Welfare and Development (DSWD) financial aid program for workers with incomes lower than the poverty threshold.

The Senate earlier deleted the AKAP as a line item in DSWD’s proposed budget, opting instead to merge it with another DSWD aid program.

Leonardo A. Lanzona, who teaches economics at the Ateneo de Manila University, said the cut in AKAP’s funding next year would make it more difficult for the government to deal with rising prices and low salaries.

“This leaves the private sector with the burden to carry out the needs of society and in the process weakens the whole economy,” he said in a Facebook Messenger chat.

In a statement, House Speaker Ferdinand Martin G. Romualdez said lawmakers increased the daily subsistence allowance for soldiers to PHP 350 from PHP 150 or to PHP 10,500 monthly.

Party-list Rep. and House Appropriations Committee Chairperson Elizaldy S. Co said P16 billion was allotted for soldiers’ allowances under the budget.

Before the plenary, Mr. Gatchalian told reporters the allocation for DSWD was cut by nearly PHP 96 billion, while the Department of Health’s budget was reduced by more than PHP 20 billion.

However, he said their budgets were still in an acceptable range.

The DSWD was given a budget of PHP 217.34 billion next year, lower than the PHP 313.26 proposed by the House and the PHP 226.67 under the National Expenditure Plan (NEP), based on a copy of the amendments included in the harmonized budget measure provided by the Senate Public Relations and Information Bureau via Viber.

“We’re talking about the DSWD still having about PHP 200 billion so it’s still within the NEP proposal and my benchmark is keeping it close to the NEP,” Mr. Gatchalian said in mixed English and Filipino.

The DoH received a PHP 247.92 billion budget for 2025, lower than the PHP 273.72 billion proposed by the House and higher than the PHP 217.39 proposed by the Budget department.

Mr. Gatchalian said the final budget bill had a shortfall of PHP 4 billion for the government’s free college education programs

The Department of Education has an approved budget of PHP 737.08 billion, which is lower than the PHP 748.65 billion proposed by the House, based on the reconciled version.

State universities and colleges will get PHP 122.16 billion under the reconciled budget.

Mr. Ejercito lamented the decision to cut next year’s budget for the Armed Forces of the Philippines’ revised modernization plan by PHP 5 billion to PHP 35 billion amid tensions in the South China Sea.

“At least it (the modernization plan funding) was not set to zero next year,” he told reporters in mixed English and Filipino. – John Victor D. Ordoñez, Reporter